Police bust massive e-commerce scam involving NGOs

14 arrested for withdrawing money from foreign credit cards through e-commerce app provided by State bank in Sri Lanka

The Criminal Investigation Department (CID) of Colombo has arrested 14 members who were allegedly involved in a massive financial fraud withdrawing money from foreign credit cards through an e-commerce application provided by a State bank in Sri Lanka, the Daily Mirror revealed.

The State bank had suffered a loss of Rs263 million due to this international fraud and the suspects have been charged under the Public Property Act, Prevention of Money Laundering Act and the Prevention of Terrorism (Temporary Provision) Act.

Through two Non Government Organisations (NGOs) the suspects had obtained the Internet Payment Gateway (IPG) facility from the State bank, the CID investigating into the incident alleged.

After the credit card holders had complained to the credit cards issuers, the fraud had come to light, that their money had been fraudulently withdrawn by someone without their knowledge.

Issuing a Chargeback Notice to the Sri Lankan bank with regard to Rs454,251/- the FIA Card Services, in one instance, a representative institution of the Bank of America in USA had alleged that the relevant money transaction had taken place without its customer’s knowledge. 

The State bank suffered a loss of Rs263 million causing severe damages to its reputation locally and internationally due to this international fraudulent transaction, the CID said.

The CID informed Colombo Fort Magistrate Kanishka Wijeratne, filing a report in connection with the incident that it had arrested 14 suspects and held under detention orders for further questioning. 

The CID suspected, a massive amount of funds could be remitted to the LTTE as well, through this fraudulent transaction.

Further investigations are being conducted by the CID while the 14 suspects arrested had been detained upon a detention order by President Mahinda Rajapakse as the Defence Minister.  

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